Airport Service Charge Increased 33%

Effective 01 March 2002, Departure Service Charge Rp. 100,000.

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(3/15/2002)

Bali's airport authority, P T Angkasa Pura I, have announced that the Airport Service Charge on all departing international passengers will increase to Rp. 100,000 (+/- US$ 10), effective March 1, 2002.

Announced via a circular letter from the Airport Authority issued just two days before the planned increase, the hike was authorized via a decree from the Minister of Communication issued on February 21, 2002. The increase represents a 33% increase from the old charge of Rp. 75,000.

The history of increases applied to the service charge, sometimes referred to as the "airport tax", include an increase from Rp. 25,000 to 50,000, introduced in August of 1998 (see Bali Update #065), and a subsequent hike to Rp. 75,000, levied just last year, in June of 2001 (see Bali Update #246).

The distribution of the funds collected by the airport have been the source of a spirited debate between local legislators in Bali who insist that the local government is entitled to a substantial share of the airport service charge revenues generated from an airport based on its territory. A formal request from Bali's local government for a Rp. 10 billion (+/- US$ 1 million) payment is still pending before Angkasa Pura's national directors.

The Acting Chief of the Bali Airport Authority, Mr. I Ketut Erdi Nuka, has publicly stated that the revenues netted from the latest increase in the airport service charge will be used to add additional terminal facilities and much needed repairs and renovation of the public toilet facilities at the island's air gateway.

The day following the announcement of the airport taxs increase, members of Bali's tourism industry reacted angrily to the proposed hike, criticizing the sudden nature of the announcement and the failure to socialize the decision before its actual introduction.

Speaking to the Indonesian language Bali Post (01 March 2002), Mr. I Gusti Bagus Yudhara, the Chairman of the Bali Chapter of the Association of Indonesian Travel Agents (ASITA) said "tourism professionals in Bali call on the airport authority - Angkasa Pusa to delay the introduction of the increase in the airport tax. This decision was very sudden and undertaken in an unfortunate circumstance."

Mr. Yudhara also explained that Bali tour operators are receiving numerous protests from foreign tour operators who feel the sudden change in airport tax violates existing understandings and should have been publicized far in advance, permitting local tour operators the chance to clarify the situation with their clients beforehand.

Departing domestic passengers are charged only a Rp. 15,000 airport service charge.